AIG first quarter earnings down slightly on interest rates, returns

NEW YORK, April 30 (Reuters) - American International Group
Inc's first-quarter earnings fell slightly as low
interest rates and weaker returns from alternative investments
offset improvements in its commercial insurance business.

The U.S. insurer also said on Thursday that it authorized
the buyback of up to $3.5 billion in additional shares.

AIG's posted operating earnings of $1.69 billion, or $1.22
per share, in the quarter. That was down around 3 percent from a
year earlier, when it had operating earnings of $1.74 billion,
or $1.18 a share.

Analysts, on average, had expected earnings of $1.19 per
share, according to Thomson Reuters I/B/E/S. It was not
immediately clear whether the analyst estimate was directly
comparable to operating earnings.

The company's net income rose more than 50 percent to $2.47
billion, bolstered by one-time gains from the sale of two of its
large shareholdings.

AIG has focused more closely on its core businesses after
bad bets on derivatives nearly sank the company - the largest
commercial insurer in the United States and Canada - during the
financial crisis.

"Our diversified business model and balance sheet
deleveraging highlight how we have reduced our overall risk
level," AIG Chief Executive Peter Hancock said in a statement.

As interest rates have remained very low, bond investors -
including insurers - have struggled to achieve adequate returns.
AIG's net investment income fell in all the company's business
segments.

In AIG's commercial insurance segment, operating income rose
to $1.46 billion from $1.42 billion as underwriting results
improved, operating income at its consumer insurance operations
fell around 19 percent to $945 million.
(Reporting by Michael Erman. Editing by Andre Grenon)